Land Tax Relief For Landlords

The South Australian government has announced an extension and expansion of the Land Tax Relief for Landlords initiative. This scheme provides eligible landlords of both residential and non-residential premise a reduction in the balance of land tax assessed on their properties. Key requirements of the initiative are:

• The property was tenanted at 30 March 2020
• At least one of the property tenants must be impacted by the effects of Covid-19 (for non- residential premises this criteria being satisfied where the tenant is eligible for the Australian Government JobKeeper payment).
• The balance of the land tax relief received by the landlord must be shown to have been passed on to the tenant(s) of the property in the form of rent relief.
• For non-residential premises the tenant(s) must not have had an annual turnover of more than $50 million during the 2018-2019 financial year.

The land tax relief is also available to residential and non-residential land owners who are unable to secure a tenant because of Covid-19.

The scheme operates across two distinctive periods being:

• Period 1: 30 March 2020 – 30 October 2020
• Period 2: 31 October 2020 – 30 April 2021

Applications for period 1 closed on 30 September 2020, however each period is assessed separately and you may be eligible for the land tax relief in period 2 although you were either ineligible or did not apply for the relief in period 1. Applications for period 2 will open soon and close on 30 April 2021.

A reduction of up to 25% in the balance of the 2019-20 land tax payable on a property is available in each period, with a maximum total reduction of up to 50%. Where the rent relief provided to tenants in a respective period is greater than the value of 25% of the land tax liability for the property, the landlord will be eligible for the full balance of the rebate. Where the rent relief provided for the respective period was lower than the value of 25% of the land tax liability for the property, the landlord will be eligible to a rebate on land tax equal to the balance of the rent relief provided.

The scheme has also been expanded for period 2 to make the land tax relief available to owner-occupiers of commercial property. A reduction of 25% of the 2019-20 land tax liability on the relevant property will be available where, subject to additional criteria:

• You actively conduct a business from the property
• The business is eligible for the Australian Government JobKeeper payment
• The business does not have an annual turnover of more than $50 million for the 2018-19 financial year

If any of the above details appear relevant to your circumstances then please review the following link to RevenueSA which details the full eligibility requirements for residential, non-residential and commercial owner-occupier landlords. This page also details evidence that may be required to support your application and provides answers to some frequently asked questions.

https://www.revenuesa.sa.gov.au/taxes-and-duties/land-tax/covid-19-relief

If you have any questions regarding land tax relief, please contact our office on (08) 7078 3505.

You might also like to read this South Australia Land Tax Reform.